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What is RCSBP? The Reserve Component Survivor Benefit Plan (RCSBP) is an insurance plan to protect your survivors against the risks of: Your early death Your survivor outliving the benefits and inflation

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Here's How it Works You pay a monthly premium to be covered under RCSBP. RCSBP Premiums and benefits depend on the "base amount" that you elect as the basis of your coverage. Your base amount can be your full monthly retired pay or just a portion. Full coverage means your full retired pay is your base amount. Your base amount is tied to your retired pay. When retired pay gets a Cost-of-Living Adjustment - adjustments for inflation, known as 'COLA' -, so does the base amount, and as a result, so do premiums and benefits.

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You have three options Option A. No change from the standard plan. Under this option, the member declines to make an election for or against SBP coverage until reaching age 60. Consequently, there would be no protection in the years between becoming retirement-eligible and attaining age 60. Also, coverage for the time beyond age 60 would require the retiree’s separate election upon becoming entitled to retired pay. At that time, the provisions of the standard SBP law would apply. Under Option A, the survivor will never receive any SBP benefits if the retired member dies before age 60. Option B. Under this option, a member can guarantee the survivor an annuity starting on the date the retiree would have attained age 60 if the retiree dies before age 60. If death is after age 60, the annuity begins the day after the date of death. Option C. This option guarantees the survivor will receive an RCSBP annuity immediately upon the death of the retired Reserve member, even if death occurs before age 60.

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Advantages of the Program SBP is protected against inflation and is subsidized by the federal government. You do not find those characteristics in commercial insurance policies or annuities. Government subsidy for SBP participants in RCSBP is 65 percent. This is higher than the subsidy for the 20-year group (26 percent) because Reserve retirees pay many fewer years of premiums (they don’t start paying until age 60) and most retirees live well past age 60. The fact that SBP is a much better deal for Reserve retirees than for 20-year active duty retirees is reflected in the much higher SBP participation rate by Reserve retirees: 94 percent vs. 60 percent or less for the 20- year group.

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Advantages Continued… on the average, the typical Reserve retiree will end up paying for only 35 percent of the lifetime benefits received by the average survivor. The government covers the rest of the cost. It works out this way because Reserve retirees don’t start paying premiums until their retired pay starts at age 60. But retiring Reserve personnel have the option to cover their spouses immediately after 20 years of creditable service. This means there can be a span of 20 years or more when the spouse is covered in the event of your death, but you don’t have to pay any premiums until age 60. Reservists pay 6.5 percent of retired pay for SBP coverage plus an average of 3.5 percent for RCSBP coverage.